Sentences with phrase «relatively higher default»

Therefore, such bonds pay a lower interest rate, or yield, than bonds issued by less - established companies with uncertain profitability and relatively higher default risk.

Not exact matches

Because credit and default risk are the dominant drivers of valuations of high yield bonds, changes in market interest rates are relatively less important.

For example, a relatively high percentage of first - time borrowers will default on their credit cards, mortgages, and other loans.

Bonds that have a high credit worthiness and a relatively low chance of defaulting on part or all of their debt.

And while average debt per student has risen over time, defaults are highest among those who borrow relatively small amounts.

[2] More recent work that tracks debt outcomes for individual borrowers documents that the main problem is not high levels of debt per student (in fact, defaults are lower among those who borrow more, since this typically indicates higher levels of college attainment), but rather the low earnings of dropout and for - profit students, who have high rates of default even on relatively small debts.

In the end, Republicans captured the default position on tax and spending policy at relatively limited cost to their high - income constituents.

Credit oriented funds typically have higher accruals and are relatively low on interest rate risk, but one can incur high losses in case of default.

The Vanguard High - Yield (aka Junk) Bond mutual fund yields about 6.5 % (relatively high yield and perceived likelihood of defaulHigh - Yield (aka Junk) Bond mutual fund yields about 6.5 % (relatively high yield and perceived likelihood of defaulhigh yield and perceived likelihood of defaults).

Due to the risk of default and relatively low recovery rate, it is also extremely important to diversify broadly with a low - cost high - yield bond ETF.

The default risk of high - yield bonds is still relatively small when compared with the risk of investing in equities, so for many investors, high - yield bonds and bond funds occupy a strategic space between stocks and less risky bonds.

Because there is almost no risk of default by the government, the return on Treasury bonds is relatively low, and a high inflation rate can erase most of the gains by reducing the value of the principal and interest payments.

Mortgages are priced higher than bonds, usually between about 1.2 per cent and 1.9 per cent, to account for higher risk of default and administration costs incurred by investors who hold mortgages as opposed to relatively hassle - free bonds.

Even so, the relatively high rate of technical defaults is a concern.